Breakfast: Over Easy

Are convenience stores giving up on breakfast?

Think breakfast. On the go. In the car. Now think of the following side by side: Dunkin’ Donuts to the left, 7-Eleven to the right.

I am inside an expansive Chicago convenience store. To my right is a Dunkin’ Donuts counter. The egg-white flatbread option seems like a tasty bite to quiet the breakfast urge, but the idea of a ham croissant with oozy cheese sounds delightful. Once my order is in, two men in brand-emblazoned aprons and caps take it into their workflow, opening and shutting steel bins that keep the bread warm, meat delectable and cheese cool. One presses his index finger to the order screen, looking closely to make sure he’s precise. With the sandwich assembled, the lead guy eases it into the toaster and moves onto the next order.

Next?

At the 7-Eleven, I find wrapped biscuit and muffin sandwiches under a warmer in a three-tiered self-serve case. I open the clear plastic cupboard and heated options await—even one that’s egg-white-only— all sitting passively, like rows of doughnuts, alike but for what’s written on their labels. A whiff away are the pizza rack and roller grill. Pizza with pepperoni floating on a dripping layer of cheese, taquitos and hot dogs rotate evenly, basking and savory. Maybe getting something for later would be a good idea. Two cashiers behind the counter keep the lines moving; one even asks to help. No thanks. I’ll take a tightly wrapped, warm ham and cheese croissant.

This kind of unscientific, random look at two breakfast sandwiches may seem haphazard, perhaps even frivolous, if it weren’t for how packed the breakfast day-part is with the incremental financial protein that every growing business needs.

Some say it’s the most important meal of the day, an estimated $47.4 billion business last year. And while many believe McDonald’s, Dunkin’ Donuts, even Starbucks and Panera own the quick-service run, the story is more complex.

Breakfast at limited-service venues, including “snack and beverage restaurants” and c-stores, was expected to reach $30 billion last year, up 7.4% from 2012, according to Rockville, Md.-based Packaged Facts. That number is projected to rise another 6.0% in 2014 and yet another 6.7% in 2015.

Single-digit percentages, yes, but consider the size of the omelet. Many indicators are in favor of c-store success, but it’ll be a scramble against these other channels that are historically positioned to fork over their portion.

The difference between the Dunkin’ Donuts and the 7-Eleven breakfasts isn’t even in price. The Dunkin’ sandwich retails for $2.89; the 7-Eleven sandwich is just 10 cents cheaper at $2.79. The real difference becomes apparent when we get to the office, where the bags—one brown paper, one supermarket plastic— open and the comparison begins. But the surprise isn’t taste. In that regard, they’re powerfully similar. Ham thickness and the sandwiches’ cheesiness are about the same. The 7-Eleven sandwich is possibly cheesier. So is this good news for 7-Eleven and likeminded c-store chains?

The difference lies in everything that led up to that first bite.

At the Dunkin’ Donuts, the guy who took my order looked me in the eye and confirmed that I had a ham croissant with cheese. When I said yes, he handed me the bag. It was wrapped in a loose pocket of thin, DD-branded deli paper with the open corner pulled over to tuck everything in. The sandwich itself was uniquely irregular, the bread and folded egg allowed to take their own form. It was fresh.

The 7-Eleven sandwich, on the other hand, was wrapped so tight a baseball player could have batted it over the ivy at Wrigley Field. And once torn from those paper binds, its shape, its personality, its essence was basically ordinary.

It may be off-base to consider the spirituality of a breakfast sandwich, but foodservice demands a kind of art, an attention to detail no matter what daypart.

“The [c-store] industry tries to run the food operation like a convenience store. It’s not,” says Larry Gerosa, a single-store operator in New Braunfels, Texas, who has a history of above-average quick-service breakfast sales. “Labor is higher. You have to have more people, not just to handle volume, but to keep it clean.”

Beyond manpower, foodservice requires inspiration. “While the average c-stores may offer ubiquitous egg sandwiches or even breakfast burritos, we see less evidence of experimentation in breakfast items like oatmeal with fresh fruit, flatbread, ciabatta or artisan bread egg sandwiches with premium cheese and meats, egg-white sandwiches, or yogurt with granola,” says researcher David Wright of The Hartman Group, Bellevue, Wash.

“Fast-casual [restaurants] are ahead in terms of progressive breakfast offerings that cue higher quality and to what I’d call the ‘new culture of food.’ ”

Plunge in oil prices sets the stage for record margins and boost in in-store sales. Also In This Issue: Profitability skyrockets for top performers! Other channels seek to redefine convenience! The economy enters a new stage. The growing health-and-wellness trend. Fuel demand; oil's slide; multicultural momentum; and data, data, data!

Since 2003 CSP magazine has ranked No. 1 in readership and market share over all other industry publications. C-store marketers have identified CSP as the preferred magazine source for their trade marketing communications. With industry-leading, highly targeted circulation to more than 100,000 subscribers, CSP reaches the key convenience retailing decision-makers fifteen times a year.